A fall in consumer demand in the US and Brazil hit profits at Nestlé in 2017.

The Swiss-based food giant added that issues at its Nestlé Skin Health arm, as well as sales growth falling below expectations to 2.4 per cent, had an impact on the results.

Net profit fell by nearly 16 per cent to CHF 7.18 billion (US$7.7bn) in 2017 compared to the result for 2016. However, year-on-year sales slightly increased by 0.4 per cent to CHF 89.8bn ($97.2bn).

Mark Schneider, Nestlé’s chief executive, said: “Our 2017 organic sales growth was within the guided range but below our expectations, in particular due to weak sales development towards the end of the year. Sales growth in Europe and Asia was encouraging while North America and Brazil continued to see a challenging environment.

“Our cost reduction initiatives delivered margin improvement ahead of 2017 expectations, in spite of considerable commodity price increases. During the past months, we have completed initial portfolio adjustments with very favourable results. We will continue this active portfolio management approach in a disciplined manner and fully in line with our strategy.”